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Delphi Workers See Pensions Plundered Under Obama

How the administration gave non-union workers the shaft -- and covered up its involvement.

Although it is almost impossible to believe, the Obama administration has yet another burgeoning scandal on its hands. Documents obtained by the Daily Caller indicate that former White House deputy press secretary Jen Psaki was aware that Treasury Department officials "crafted the press releases and public messaging for General Motors during the 2009 auto industry bailout." The Caller had obtained the documents in 2011, but an agreement with the source who provided them prevented their publication before now. The names of fellow White House staffers Brian Deese and Amy Brundage appear on the documents as well. Ms. Psaki has returned to the president's election campaign as his traveling press secretary.

In one of the emails obtained by the Caller, an exchange between Greg Martin, GM’s director of policy, and the Treasury Department’s Jenni Engebretsen, reveals an effort was made to de-emphasize Treasury's role in the bailout of the beleaguered auto company. The effort was prompted by the draft of a GM press release indicating the company would be shutting down operations at several factories. “We would ask that you move the reference to Treasury down to the third paragraph, taking it out of the lede," wrote Engebretsen. “Please let us know if this presents any issues.” Martin replied, “No problems. Done.”

Downplaying Treasury's role served two purposes. It served the administration's goal of minimizing public perception regarding their role in the bailout, as well as the role Treasury played in the scandal surrounding the evisceration of pensions for salaried, non-union employees at Delphi Automotive, the largest and most diversified supplier of automotive parts, and a GM spinoff.

Delphi retirees lost as much as 30 to 70 percent of their pensions, along with their healthcare, life insurance and other benefits--even as unionized employees, working with their non-union counterparts in the same capacities, had their pensions and benefits “topped off” and made whole.

The Obama administration has attempted to shift the blame for that decision onto the Pension Benefit Guaranty Corporation (PBGC), a federal government agency that handles private-sector pension benefits issues. Former Treasury official Matthew Feldman, and former White House auto czar Ron Bloom, who were key members of the Presidential Task Force on the Auto Industry during the GM bailout, testified under oath to that effect. “As a result of the Delphi Corporation bankruptcy, for example, Delphi and the Pension Benefit Guaranty Corporation were forced to terminate Delphi’s pension plans, which means there are Delphi retirees who unfortunately will collect less than their full pension benefits,” attested Feldman on July 11, 2012.

Yet a series of emails obtained by the Caller last August reveal that the Treasury Dept., with Secretary Tim Geithner in a leading role, "was the driving force behind terminating the pensions of 20,000 salaried retirees at the Delphi auto parts manufacturing company." Furthermore, those emails contradict sworn testimony given in federal court by administration officials (as noted above), indicate the administration misled congressional lawmakers about the sequence of events surrounding the bailout, and show that members of the administration violated federal law.

August was also when House Ways and Means Chairman Dave Camp (R-MI) sent document requests to the White House, Treasury and the PBGC according to a press release issued October 3, 2012. The release further notes that, in answering that request, the "PBGC provided what appears to be a nearly complete response, while Treasury provided an incomplete response. The White House provided no documents, but claimed Treasury was responding on its behalf."

Despite the stonewalling, key findings in those documents reveal that Treasury lied when it characterized its involvement as "an advisory role only," in PBGC's "independent" decision, and that as late as May 28, 2009, officials involved in negotiations were still discussing the idea that GM would assume both Delphi non-union and union pension plans. Yet following "extensive Treasury involvement," the decision was made to supplement only union-worker pension plans.

“Treasury was clearly in the center of the decision to terminate the pensions of Delphi’s salaried workers,” Camp said in the release. “Instead of withholding important documents, Treasury should release all documents without further delay and give these hardworking Americans answers as to why Treasury believed they were not entitled to their full pensions. I have serious concerns about this Administration picking winners and losers in Delphi’s bankruptcy.”

On October 26, Camp pushed the envelope. “The White House is withholding documents and has failed to provide a legitimate reason,” he told the Caller. “The president and his lawyers should either claim executive privilege and be prepared to defend it for each and every document or turn over the documents without further delay.” Camp was likely responding to an Oct. 12 letter sent by White House counsel Kathryn Ruemmler, who suggested that Obama could, in fact, invoke executive privilege. “Your request for all EOP [Executive Office of the President] communications implicates longstanding and significant executive branch confidentiality interests,” Ruemmler wrote, “an encroachment upon [sic] which is unnecessary at this time.”

Camp’s Committee is one of three in the House investigating the Delphi pension scandal. The House Committee on Oversight and Government Reform and the House Committee on Education and the Workforce are the other two conducting their own probes. All three have been stonewalled by Geithner and the Treasury Department, and all three are threatening to issue subpoenas to Treasury and the White House to get to the bottom of the machinations behind the shaft given to non-union Delphi employees, even as their United Auto Worker (UAW) brethren emerged from the bailout unscathed.

That would be the same UAW who gained majority control of GM itself when the Obama administration trampled established bankruptcy law. And it would be the same General Motors the administration touts as a "success story" on the campaign trail.

Yet more than 20,000 Delphi workers face an uncertain future, and GM's success story is nothing of the sort: of the $50.7 billion taxpayers shelled out to save the company, $27.2 has yet to be paid back--and likely never will be. The much-touted production of the eco-minded Chevy Volt has been suspended due to anemic sales--and GM's 2011 annual report reveals that two-thirds of GM's jobs are located in foreign countries.

Contempt for the law, and the ongoing efforts to stonewall that contempt, form the core of this administration. It is a "template" that can be plugged into any one of numerous scandals this administration has inflicted upon the nation, from the expenditure of treasure, represented by a string of green company bankruptcies and the GM bailout, to the expenditure of blood, represented by the death of American heroes in both Fast and Furious and Benghazi. 20,000 Delphi workers are now well aware that, with respect to an administration that has spent four years picking America's "winners and losers"--based on nothing more than crass political calculations--they belong to the latter group.